Defendants Claimed Consumers Would Make Money from Links to Major Retailers

For Release

May 14, 2012

The Federal Trade Commission halted an operation that allegedly lured consumers into spending thousands of dollars for Internet websites and advertising by misrepresenting that they could make lots of money by linking the sites to major retailers. The court ordered a stop to the defendants' allegedly deceptive practices and froze their assets pending further litigation. The action is part of the FTC's ongoing efforts to protect consumers in financial distress.

According to the FTC's complaint against North America Marketing and Associates LLC, for fees ranging from $100 to $400, the defendants promised to build and host websites for consumers, who would earn commissions when Internet users clicked through the consumers' websites to make purchases from "Fortune 500" retailers such as Wal-Mart, Best Buy, and Starbucks. The defendants also claimed consumers would get free, full-time marketing expertise to help them make substantial profits.

Instead of the free marketing help they were promised, consumers got a follow-up sales pitch from the defendants, who tried to get them to pay even more money for an advertising package that typically cost from $5,000 to $20,000, the FTC alleged. The defendants claimed the package would help generate sales of $3,000 to $20,000 per month, depending upon the size of the package consumers bought. However, according to the agency, the advertising packages did not generate any significant sales commissions, and some consumers who complained to the company were sold thousands of dollars in additional advertising services. When consumer complaints mounted, the defendants shut down operations and renewed the deceptive business opportunity under new business names.

The defendants are charged with violating the FTC Act and the FTC's Telemarketing Sales Rule (TSR) by misrepresenting that consumers who bought and used websites and advertising packages would earn substantial income, and that experts would help them operate their business. Sheila Ann Lowry, Carl Edward Morris, Jr., and Marketing Strategies LLC are named as relief defendants for allegedly profiting from the illegal practices.

The Commission vote authorizing the staff to file the complaint was 5-0. The complaint was filed in the U.S. District Court for the District of Arizona. The court entered a temporary restraining order against the defendants on May 2, 2012.

NOTE: The Commission files a complaint when it has "reason to believe" that the law has been or is being violated and it appears to the Commission that a proceeding is in the public interest. The complaint is not a finding or ruling that the defendants have actually violated the law. The case will be decided by the court.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC's online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics. Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.